Rubber down amid doubt over ITRCo<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
The price of natural rubber has been declining during the past
\ntwo weeks as the market doubts the rubber consortium formed by
\nthree major producers will work, an expert says.<\/p>\n
\"Today, the price of natural rubber on the international
\nmarket is only 86 U.S. cents per kilogram, compared to around 92
\ncents two weeks ago,\" chairman of the Rubber Association of
\nIndonesia (Gapkindo) Asril Sutan Amir said.<\/p>\n
\"The local farmers will suffer from this,\" he added.<\/p>\n
Indonesia, Thailand, and Malaysia signed a memorandum of
\nunderstanding (MoU) last month to set up the International
\nTripartite Rubber Company (ITRCo), a special consortium with a
\nmission to help shore up the sagging price of the commodity and
\nhelp improve the welfare of rubber farmers.<\/p>\n
Under the plan, the consortium will buy and stockpile rubber
\nfrom the three countries.<\/p>\n
But Asril said there was now doubt in the market that ITRCo
\nwould work immediately as clear-cut guidelines to run the
\nconsortium had yet to be made.<\/p>\n
He said there was no agreement yet on how much rubber the
\nconsortium would buy and at what price.<\/p>\n
Asril urged the governments of the three countries to quickly
\nrealize the ITRCo plan.<\/p>\n
\"If they (governments) can not run the ITRCo, they can appoint
\nthe private sector to run it,\" he said.<\/p>\n
Thailand, Indonesia and Malaysia jointly control around 62
\npercent of the world's natural rubber production.<\/p>\n
Under the ITRCo mechanism, the above three countries agreed to
\nraise an initial capital outlay of US$1 million.<\/p>\n
ITRCo was established following the forming of the
\nInternational Tripartite Rubber Council (ITRC) last year in Bali.<\/p>\n
Under the council framework, the three countries have pledged
\nto cut rubber output by 4 percent and exports by 10 percent
\nstarting this year.<\/p>\n
For 2002, Indonesia will lower its rubber exports to 1.23
\nmillion tons, while Thailand has set a limit at 1.93 million tons
\nand Malaysia will cap its export volume at 227,000 tons.<\/p>\n
The Thai government has agreed to reduce rubber supply and
\nraise prices by giving farmers $6.93 million to cut down and
\nreplant rubber trees.<\/p>\n
The Indonesian government, however, has done nothing, said
\nAsril.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rubber-down-amid-doubt-over-itrco-1447893297",
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"sponsor": "Okusi Associates",
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